Nevada Inmates Collect Millions In Unemployment

LAS VEGAS (AP) — Nevada inmates are collecting millions of dollars in unemployment benefits while sitting in their cells, according to a state audit report released Thursday.

It’s a problem that has been documented across the country. During the past two years, state audits have found prisoners collecting unemployment benefits along with their three meals a day in Arizona, Illinois, Michigan and New York.

In Nevada, auditors found that the Employment Security Division paid as much as $5 million in unemployment benefits to inmates during the last three years.

Auditors reviewed 97,000 residents who filed claims in January and found that 67 of these claimants were incarcerated. Combined, that group illegally received $214,000 while behind bars.

The report also found eight instances of possible identify theft and 15 instances in which jobless benefits were paid to people who had died.

The state wants its money back.

“That someone is incarcerated and might have filed is something we take very seriously and prosecute to the fullest extent of the law,” employment department director Frank Woodbeck said.

The auditor’s report called upon unemployment benefit administrators to implement tighter controls to ensure claims for jobless benefits are legitimate, including checking incarceration and death records.

The division also currently fails to check jobless claims with private insurance data on people also receiving workers’ compensation, the audit found. Under state law, people out of work because of job-related injuries are ineligible for unemployment benefits.

Woodbeck said the state had already corrected these problems before the audit was released by standardizing checks with federal and state databases before issuing benefits. He said the department is also in the midst of a $30 million computer upgrade that will “attack the systemic problem of overpayment and underpayment and this type of thing.”

He downplayed the extent of the fraud.

“Five million dollars is a lot of money. However, we’ve had hundreds of millions in benefits paid out, so it is less than one percent,” he said.

Townsend said he suspected a routine audit of the state’s unemployment system might reveal a lack of attention paid to inmate claims.

“We didn’t know for sure until we were done, but based on what we saw in other states, the potential was there,” he said.

In the spring, officials at the Los Angeles County jail revealed that a convicted killer nicknamed “Chopper,” had received more than $30,000 during two years in fraudulent unemployment while incarcerated.

The Employment Security Division has a 60-day window to present the auditor with a plan to prevent further instances of inmate abuse.